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The Tech Garden, which provides resources for startup technology businesses in Syracuse, will proceed with its proposed $16 million expansion after Syracuse’s Common Council voted to approve a lease agreement in late March.

The agreement extends the lease between the city and CenterState CEO — the nonprofit economic development organization that runs The Tech Garden — for an additional 20 years. Since 2005, The Tech Garden has operated out of a city-owned building that the city leases to the organization for only $1. That price will remain the same under the new agreement.

The Tech Garden’s expansion project will involve the construction of two additional floors to the existing building, said Caitlin Moriarty, director of operations at The Tech Garden. The expansion of the building will add roughly 46,000 square-feet — enough space to hold 100 of the organization’s members in person and 200 members virtually, according to The Tech Garden’s website.

Over the past few years, the organization has struggled to meet the increasing demand from entrepreneurs and startup companies for office space in the building, Moriarty said. Since 2017, The Tech Garden has gained an average of 26 members per year. As each of these startups grow, they require more space to house their rising number of employees.

“The quality of (these) startups is increasing, and their needs are also increasing,” Moriarty said. “Last year, we did a survey of our 108 startups, and they created 411 new jobs. We need to have space in offices to be able to fit the new jobs that they’re creating.”

In addition to office space, The Tech Garden hopes to expand its hardware and manufacturing center for businesses that develop hardware products such as drones or robotic equipment, she said.

Gov. Andrew Cuomo first announced The Tech Garden’s expansion plans in November 2019, along with his announcement of a $12.5 million investment from the state to fund the project. The Tech Garden had been unable to proceed with the project until it renewed its lease agreement with the city, which the Common Council had to approve.

Over the past month, the future of the expansion remained uncertain as councilors debated whether the organization should be able to continue leasing the building it operates out of at essentially no cost.

Councilor-At-Large Michael Greene wanted the lease agreement to include a requirement that CenterState CEO share a portion of its profits with the city in return for the building being leased to the organization practically for free. He argued that The Tech Garden’s potential future profits, if shared with the city, could help reduce the city’s $8 million deficit.

Shannon Kirkpatrick | Presentation Director

“We’re a city that’s had to make really difficult choices over the last few years,” Greene said. “We’ve furloughed city employees. We had to use GoFundMe to open our pools in the summer. We’re a city that just doesn’t have the financial ability to provide basic services for our residents.”

CenterState CEO President Rob Simpson refused to agree to Greene’s stipulation. Negotiations stalled for weeks, until Councilor-At-Large Khalid Bey was able to reach an agreement with Simpson, which was approved by the Common Council in a seven-to-two vote, with Greene and Councilor-At-Large Ronnie White voting against it.

Throughout the negotiations, local companies that have worked out of The Tech Garden were outspoken in their support for its expansion.

Chedy Hampson, the founder and CEO of TCGplayer, an online platform for buying and selling trading cards and other collectibles, said in an email that The Tech Garden’s expansion is necessary for Syracuse to continue to develop its technology-oriented economy.

“Startups are the lifeblood of our emerging economy,” Hampson said. “By expanding The Tech Garden’s footprint, we will further develop and attract diverse technology talent and expand the network effect of startups and growth companies.”

Since 2017, The Tech Garden has gained an average of 26 members per year. As each of these startups grow, they require more space to house their rising number of employees. Annabelle Gordon| Asst. Photo Editor

CenterState CEO also agreed to create a $250,000 “revolving loan fund” that will provide loans to startup companies that remain in Syracuse after graduating from The Tech Garden. Companies that choose to locate their businesses in lower-income areas of the city will be eligible for more generous loans, per the agreement.

The Tech Garden has existing programs that assist startups with establishing themselves in the city, and this new loan fund will continue to help businesses “outgrow The Tech Garden” and relocate their operations to different neighborhoods in the city, Moriarty said.

In the coming weeks, The Tech Garden will begin searching for a company to assist in solidifying the details surrounding the building’s expansion, including the overall timeline of the project, she said. Though the project is still in its early stages, Moriarty is excited to take the first steps in making the Tech Garden’s proposed expansion a reality.

“This expansion allows us to serve more startups, which is, as you can imagine, very aligned with our mission,” she said. “It’s really about increasing demand, about having more sophisticated startups in our membership, and trying to be the best incubator we can be to be able to serve their needs.”

Published on April 14, 2021 at 10:47 pm

Contact Gillian: gifollet@syr.edu